The Downside of Transparency

by Matthew E May

Massive information and idea sharing is the hallmark of a high-performing and innovative company, right? When critical information and good ideas flow freely, everyone’s on the same page, everyone knows what everyone else is doing, and that transparency can only be good, right?

Maybe not. Maybe too much information isn’t so good. Maybe Law #3: Limiting information engages the imagination, has some social and company cultural consequences.

According to Indiana University cognitive scientist Robert Goldstone, when information is freely shared, good ideas can stunt innovation by distracting others from pursuing even better ideas.

At the heart of his study was a single compelling question: “How do you structure your community or organization so you get the best solution out of the group?”

According to Goldstone: “It turns out not to be effective if different inventors and labs see exactly what everyone else is doing because of the human tendency to glom onto the current ‘best’ solution.”

In another words, transparency may just make us lazier. Let’s face it, coming up with new and novel ideas with any consistency isn’t exactly easy.

Goldstone’s research examines and charts group behavior and the patterns in which people unknowingly participate — much like ants creating colony structures about which they are clueless.

His study used a virtual environment in which study participants worked in specifically designed groups to solve a problem. Participants guessed numbers between 1 and 100, with each number having a hidden value. The goal was for individuals to accumulate the highest score through several rounds of guessing. Across different conditions, the relationship between guesses and scores could either be simple or complex. The participants saw the results of their own guesses and some or all of the guesses of the others in their group.

In the “fully connected” group, everyone’s work was completely accessible to everyone else — much like a tight-knit family or small town. In the “locally connected” group, participants primarily were aware of what their neighbors, or the people on either side, were doing. In the “small world” group, participants also were primarily aware of what their neighbors were doing, but they also had a few distant connections that let them send or retrieve good ideas from outside of their neighborhood.

Goldstone found that the fully connected groups performed the best when solving simple problems. Small world groups, however, performed better on more difficult problems. For these problems, the truism “The more information, the better” is not valid. In other words, beware of TMI (too much information)!

“The small world network preserves diversity,” Goldstone said. “One clique could be coming up with one answer, another clique could be coming up with another. As a result, the group as a whole is searching the problem space more effectively. For hard problems, connecting people by small world networks offers a good compromise between having members explore a variety of innovations, while still quickly disseminating promising innovations throughout the group.”

Matthew E. May is the author of “IN PURSUIT OF ELEGANCE: Why the Best Ideas Have Something Missing.” He is constantly searching for creative ideas and innovative solutions that are ‘elegant’ – a unique and elusive combination of unusual simplicity and surprising power.